Wall Street split along style lines on Monday as investors shifted out of technology and into value shares, positioning for a week that brings third-quarter results from the largest U.S. banks and the final inflation reading before the Federal Reserve's late-October meeting.
The Dow Jones Industrial Average closed at 51,850.55, up 195.60 points or 0.38%. The S&P 500 finished at 7,807.21, down 4.33 points or 0.06%, holding just below its record. The Nasdaq Composite fell 120.27 points, or 0.44%, to 27,245.90.
Rotation Out of Technology
Communication services led the sector tables while technology and utilities lagged. Micron and SK Hynix each dropped more than 3% after Chinese memory maker CXMT disclosed progress on a new memory-cell design, and Nvidia slipped about 1% as the semiconductor trade cooled.
There were pockets of strength. Meta Platforms gained roughly 3% after Chief Executive Mark Zuckerberg said the company's Muse Wonder AI model "has caught up with frontier AI labs." eBay climbed after a Morgan Stanley upgrade citing growth in live commerce. Chipotle fell about 4% after Starbucks denied acquisition speculation.
The 10-year Treasury yield held near 5.24%, close to a 24-year high — a level that continues to weigh on long-duration growth names. Gold eased 0.56% to about $4,192 an ounce, while crude extended gains on Middle East tensions, with Brent near $106 a barrel and West Texas Intermediate up 1.65% to $93.37.
Banks Report Tuesday
JPMorgan Chase, Goldman Sachs, Citigroup and Wells Fargo are scheduled to report Tuesday, with Bank of America and Morgan Stanley following Wednesday. Analysts expect double-digit earnings growth at JPMorgan, more than 10% growth at Wells Fargo, and roughly 10% revenue growth at Goldman Sachs. Bank stocks have fallen about 7.5% over the past month on concern that higher rates will dent loan demand and investment banking activity.
"Earnings have been incredible this year, and we're just going to have to start to see with the banks how Q3 shaped up," said Matthew Miskin, co-chief investment strategist at Manulife John Hancock Investments. He questioned whether "the market is sniffing out something that is underneath the surface for these financial companies."
Matt Stucky, chief portfolio manager of equities at Northwestern Mutual Wealth Management, framed the concern more directly: "We've seen rates back up. We've seen energy costs back up. And the question is, how is this impacting the consumer?"
CPI Is the Week's Hinge
The September Consumer Price Index arrives Wednesday at 8:30 a.m. ET, followed by producer prices Thursday. Economists expect headline inflation to accelerate to roughly 3.7% year over year from 3.4%, with the core measure near 2.5%. The Cleveland Fed's nowcast puts headline CPI at 3.60% and core at 2.39%.
It is the last inflation print before the Oct. 27-28 Federal Open Market Committee meeting. The federal funds target range stands at 3.75%-4.00% after September's increase, and CME Group's FedWatch tool prices roughly a 17% chance of another quarter-point hike this month — odds that fell sharply after a soft September jobs report.
"We really want to see material progress on core services inflation to get a little bit more confident that the Fed doesn't have to be as aggressive," said Michael Reynolds, vice president of investment strategy at Glenmede. He added a warning for equity bulls: "At some point, major indices are going to cry uncle on higher rates."
Stucky agreed that an upside surprise would be the bigger risk. "If you start to see more evidence of re-accelerating inflation that's not going to come down absent a full hiking cycle from the Fed, that's where equity markets really can be under pressure."
Sources: Reuters ("Bank earnings, CPI headline busy markets week as S&P 500 hovers near records"), Yahoo Finance market live coverage for Oct. 12, 2026, The Motley Fool, CME Group FedWatch, Federal Reserve Bank of Cleveland inflation nowcast, Bureau of Labor Statistics release calendar.